Don't Panic Over JinkoSolar's Drop Today

The global solar market is improving rapidly, but expectations are still getting ahead of reality. That's what hurt JinkoSolar Holdings Co., Ltd.  (NYSE: JKS  ) today after reporting vastly improved earnings and still watching its stock drop 3% during trading.  

First-quarter shipments were up an impressive 72% to 581.2 MW, and revenue jumped 73% to $323.9 million. JinkoSolar even swung to a small profit of $1.5 million from a loss a year ago.

What investors need to keep in mind is that the first quarter is seasonably slow for solar companies, who usually see a rush of demand in the fourth quarter. That was the case for JinkoSolar, as indicated by a drop in shipments from 586.3 MW, although that was quite a bit smaller than the drop experienced by other solar companies.

JinkoSolar also has projects under construction, which can swing revenue and earnings from one quarter to the next. 140 MW of projects are expected to be completed in the second quarter, with construction starting on 200 MW to 250 MW more. Long-term, these projects and growing global demand will help drive results higher, so I wouldn't be too concerned about a slight drop in the stock today, because operations are headed in the right direction.

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  • Report this Comment On May 28, 2014, at 12:09 AM, chrisceeaustin wrote:

    Be patient with this stock. It may earn $5 or $6 per share this year. That may translate to a 90 dollar stock price.

  • Report this Comment On May 28, 2014, at 11:24 AM, never2dull4u wrote:

    Dont' panic?

    I'm more curious as to why CSIQ and JKS are trading in the mid $20's when TSL (far superior company by all metrics) are still trading in the low teens.

    I started picking up JKS last week. I just don't understand how the hedge fund managers as well as analysts think when picking stocks. TSL is by far a superior company. It's market value should at least be 5X it revenues.

    One thing is certain, investors/traders only chase stocks that are moving UP. Patient investors will be rewarded (just as I have with AAPL).

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Travis Hoium

Travis Hoium has been writing for since July 2010 and covers the solar industry, renewable energy, and gaming stocks among other things.

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9/2/2015 4:02 PM
JKS $19.65 Up +0.57 +2.99%
JinkoSolar Holding… CAPS Rating: **